Diversity and Donations: The Effect of Religious and Ethnic Diversity on Charitable Giving

We explore the effects of local ethnic and religious diversity on private donations to charity. We find that an increase in religious or ethnic diversity decreases donations. The ethnicity effect is driven by non-minorities and blacks, and is strongest in high income, low education areas. The religious effect is driven by Catholics, and is concentrated in high income, high education areas. We find no evidence that diversity affects the fraction of households that donate. Our results provide a parallel to the negative effects of diversity on publicly provided goods, and opens new challenges for fundraisers and policy makers.